3 ms·

Position in startup - emp. #5. Equity negotiable after 3mnths - normal? What percentage reasonable?

1 points by wr1472 19y ago

wr1472 19y ago
I've been offered a development position in a startup. The technology is pretty cool and I think has potential. I think there is a high barrier to entry in addressing the same problem. The company has just secured round a funding and estimates there should be enough money to keep going for 12 - 18 months with the growth anticipated. I don't now these guys personally and only ever spoke to them during the interview. Would I be crazy to accept or should I be a bit more diligent?
joshwa 19y ago
Negotiate your percentage now (single digit percentage would be appropriate for non-founder with low employee number), and have it vest over 12-24 months. "negotiable in 3 months" smells fishy to me.
wr1472 19y ago
I think what is negotiable in 3 months is the amount of equity. what I may ask for is the guarantee of some (read minimum amount of) equity in 3 months written into my contract.
pg 19y ago
A startup is right to want a trial period for such an early employee, but 3 months is on the long side. Half that should be enough for them to decide. The percentage is impossible to predict. On average maybe 2% for a hacker. Less if they're post series A, or the salary is substantial.
wr1472 19y ago
Salary is market rate, I think I may push for a shorter trial period, or more importantly a clause saying I will get a minimum amount - say 1% which we can then negotiate an increase on in 3 months. To be honest a trial period of 1.5 or 3 months seems inconsequential, what I am mindful of is at the end of the trial period, they change their minds and say they're not going to offer me any equity.
- pg 19y ago
  It's reasonable to talk about what range of numbers they're thinking about. You don't want to work 3 months and then learn they consider .1% generous. But if you specify a minimum, that may start to become the default number in both your heads.
  - wr1472 19y ago
    Thanks for your input, I think I will ask to see what range they are thinking about. Will let you guys know what they say!
    - wr1472 19y ago
      Just had a chat with one of the cofounders. I misunderstood / recruitment agent mis-told me that it was equity, rather it is a company share option scheme. I will be offered 100 shares (3yr vest period) which isn't great however this will hopefully be pre series A and so strike cost should be a lot less post series A. Is it worth going for share options (even if it's only for 100 shares)? I don't see this as compensation for salary but more of a bonus if anything. what does eveyone think?

1 points by wr1472 19y ago

I've been offered a development position in a startup. The technology is pretty cool and I think has potential. I think there is a high barrier to entry in addressing the same problem. The company has just secured round a funding and estimates there should be enough money to keep going for 12 - 18 months with the growth anticipated. I don't now these guys personally and only ever spoke to them during the interview. Would I be crazy to accept or should I be a bit more diligent?

joshwa 19y ago

Negotiate your percentage now (single digit percentage would be appropriate for non-founder with low employee number), and have it vest over 12-24 months. "negotiable in 3 months" smells fishy to me.

wr1472 19y ago

I think what is negotiable in 3 months is the amount of equity. what I may ask for is the guarantee of some (read minimum amount of) equity in 3 months written into my contract.

pg 19y ago

A startup is right to want a trial period for such an early employee, but 3 months is on the long side. Half that should be enough for them to decide. The percentage is impossible to predict. On average maybe 2% for a hacker. Less if they're post series A, or the salary is substantial.

wr1472 19y ago

Salary is market rate, I think I may push for a shorter trial period, or more importantly a clause saying I will get a minimum amount - say 1% which we can then negotiate an increase on in 3 months. To be honest a trial period of 1.5 or 3 months seems inconsequential, what I am mindful of is at the end of the trial period, they change their minds and say they're not going to offer me any equity.

pg 19y ago
It's reasonable to talk about what range of numbers they're thinking about. You don't want to work 3 months and then learn they consider .1% generous. But if you specify a minimum, that may start to become the default number in both your heads.
- wr1472 19y ago
  Thanks for your input, I think I will ask to see what range they are thinking about. Will let you guys know what they say!
  - wr1472 19y ago
    Just had a chat with one of the cofounders. I misunderstood / recruitment agent mis-told me that it was equity, rather it is a company share option scheme. I will be offered 100 shares (3yr vest period) which isn't great however this will hopefully be pre series A and so strike cost should be a lot less post series A. Is it worth going for share options (even if it's only for 100 shares)? I don't see this as compensation for salary but more of a bonus if anything. what does eveyone think?